Skip to main content
9:00 am
global basis. >> thank you. it's been a pleasure having you here. >> happy thanksgiving. >> happy thanks to you. happy thanksgiving to all of you. join us on friday. that does it for us today. right now it's time for "squawk on the street." you can have all the turkey you want tomorrow. good morning, welcome to "squawk on the street" i'm carl cramer is off today. some word the fiscal cliff negotiations are not getting off to a good start. moderate red arrows. european leaders failed to reach a bailout payment to greece and will try monday. road map starts on the busiest travel day of the year. there are signs it could be a big quarter for airline and travel, but traditional toys
9:01 am
look weak. walmart may have protesters outside its doors on friday. >> deer misses earnings, and the market shrugs it off. >> turmoil in israel with a bomb explosion on board a bus today and a rumored cease-fire that never happened. crude is up $1 as the secretary of state has arrived in cairo. a big day full of planes, trains and automobiles with tens of millions of americans set to embark on their holiday weekend journeys. our phil lebeau is in chicago with more on the holiday travel landscape. how painful is it going to be? >> you know, carl f you're traveling, you always need a little more patience thanksgiving weekend. for the airlines, they're keeping their fingers crossed because if you look at a map of the united states, you really don't see any major storm systems. that means if it's a smooth weekend, you talked about this being important to the profitability of fourth quarter, that's certainly good news for the airlines. take a look at the number of people who will be traveling this thanksgiving weekend.
9:02 am
just under 44 million people. that's a slight increase from last year. the average amount they're spending, that's down 10%. less than $500. why? in large part it's because fewer people are flying. they're not spending as much for the airfare that might cost them $400, $500, maybe $600 if they're flying across the country. airlines have held down capacity. that's one reason fewer people are flying. another reason is because of the economy, some people are saying i'm going to hold off in terms of booking a flight especially because fares are not dropping. because there's limited capacity. the airlines have been able to hold fares at a fairly consistent level. they are down according to aa compared to last year. still, you won't find too many bargains unless you're looking for last minute deals to nontraditional places. one other thing, guys, as we take a look at rental car stocks, you've heard a lot of stories over the last couple of days. it's true. if you were looking to rent a car in the northeastern united
9:03 am
states, which some people do during the holiday weekend, good luck because most of them are already spoken for. this is the carryover effect from superstorm sandy. so many cars were damaged, destroyed during the storm. as a result, rental cars have been tight for some time in the northeastern united states. and that's the case this weekend. a lot of people, believe it or not, guys, they do like to rent a car in order to make the trip of 300 or 400 miles. this year in the northeast, good luck if you don't already have a reservation. carl, back to you. >> phil, the airport where you are looks pretty crowded but orderly. there's one silver lining for people who are traveling and that is, perhaps, airlines are actually running closer to on on time these days. >> reporter: yes. that's because you've seen restricted capacity. fewer flights, it's not as packed and as a result it's easier to keep with the on-time schedule. >> unbelievable, phil.
9:04 am
thanks so much. phil at o'hare. i saw a stat today, since '07 i think airlines have taken out 14% of their capacity. >> wow. >> they're running lean and mean. in terms of getting a flight over the holidays, it's going to be packed. it's going to be packed flights. >> in terms of an approach to the sector, some who say you're starting to see the airlines generate real free cash flow with come consistency, in part because of what you mentioned. in the past it's like, okay, more capacity, more capacity, lower prices. they haven't done that. it's important to keep an eye on from an investment perspective. if they keep generating free cash flow, the trade, so to speak may dissipate and they may be an investment. >> and an opportunity to gain shares with airlines, with u a. l with computer problems that grounded flights. some say customers have defected, they left ual, they don't want to take a chance and that could be an opportunity for other carriers to gain those customers. meantime, retailers, another
9:05 am
big story as we gear up for the holiday season. we're counting down to black friday. in some cases black thanksgiving night. courtney reagan at headquarters with a round-up. >> i'm getting excited. two days until what many see as the biggest shopping day of the year. the forecasts are as plentiful as the door busters. the internet has changed things for some. the weather is forecast to be mostly dry throughout the country. not terribly cold. that should help traffic. the national retail federation expects 147 million shoppers will hit the stores or the web black friday weekend. that's 5 million less than planned to do so last year. deloit says 63% of those surveyed will shop in stores black friday. 23% thanksgiving day. that's up from 17% last year. as is the tradition retailers are heavily promoting, even those like jcpenney who normally don't do sales. it's for a market share.
9:06 am
many retailers are rolling outdoor busters progressively using social media to announce the deals. electronics will be the hot item, tablets and blu-ray players, and furbie back, too. it could be 10% to 20% of the holiday sales. it could be $158 billion total sales. thanksgiving is falling, the technical earliest it could fall. this year the first was a thursday, so that means there are more days between thanksgiving and christmas for shopping and selling. and then you add in the early thanksgiving hours and this may be the longest holiday shopping season we've had in a number of years. >> courtney, are you hearing anything about the walmart protest and whether that could impact the holiday shopping season? walmart says customers who go to their stores, everything will be operating normally, they won't see anything unusual at the stores but what are you hearing on the ground? >> from what i can tell, that
9:07 am
does seem to be the case in most locations. i mean, keep in mind walmart has almost 4,000 stores. some workers will be protesting at some locations. however, it is not expected to disrupt the actual shopping. if it would, there is actually some legal action that walmart can take. that's what i've heard, according to some lawyers i spoke to. if any protests disrupt shopping, block doors, things like that that could make it dangerous for the associates at work or the consumers themselves. bottom line, it seems like the protests will happen. it's not expected to disrupt shopping to a large degree. >> there's a lot of discussion about how there's no must have traditional toy this year. with all the competition from apps and games, i mean, regular toys are kind of in trouble. >> i know. >> one of the worst christmases expected. >> if you look at the top toys, it's toys we've seen from many years. barbie top of the girls list,
9:08 am
lego, monster high dolls for girls, furbie. we've seen it before. ipads are on a lot of children's lists. they see moms and dads using them, they want to play angry birds or whatever the hot game is. you have retailers like toys "r" us creating their own tablet for children. we'll see how well that takes off. we know apple is the market share leader there so kids might pass over toys "r" us tablet for the ipad because that's what they know. >> some of the downgrades of hasbro and mattel shows that. you'll be busy. >> i'm excited. >> what is tops on your list in your household for toys? >> anything involving princesses. david, i don't know about you, but rapunzle hair, that was a big question. >> that was a couple years ago,
9:09 am
the tower. 10-year-old boy, no toys. toys are done and over. underarmour and smeekeneakers. that's awe he wants. >> faster to run away from you. deer reporting well below wall street estimates but revenue exceeded consensus. they see demand for large equipment but noticed caution around livestock and dairy markets. this is a stock with renewed focus because it is warren buffett's -- one of his latest additions. small stake but he did add. >> $143 million. "the journal" takes a crack at why you would want it. secular advances in need for global grain output, emerging markets and so ford. along his burlington northern play. he adds to the position down the road. it's only a 1% stake right now.
9:10 am
>> where are we in terms of -- i know the company put outlook looking 5% increase for full year 2013 in equipment sales, 10% for the first quarter and $3.2 billion. how does that figure -- >> in line with what wall street was expecting. revenue guidance, growth guidance, that was a little stronger than was expected. this stock has had a monster run since its last earning report back in august. it's up 18% since the end of september. an outperformer relative to the broader market. the question is, is this a pullback, not only because the eps missed but also because they had a big run of late. . are people simply taking profits here? >> we don't talk a lot before greece because there's a lot we don't know. they worked for 11 hours overnight trying to get a bill for this bailout tranche. merkel says there's a good chance we'll get there but they're not infusing a lot of confidence into the market. >> they aren't.
9:11 am
it's been weeks and continues to be a bit of a divide between the imf and other parties and what christine lagarde has indicated would be her desire to go through 2016. we'll see. it's amazing to think we're still talking about greece. even if they get these dispersements over time there's still a belief you have to pound down on creditors again if you're really going to return this country to anything regarding fiscal rectitude. >> worried about france, the country that preceded it. from a fiscal cliff rally to the pullback, what's ahead for the market? want to bring in michael jones with river front investment group and charles, vice chairman and director with aerial investments. there's a piece this morning saying opening round of talks over the fiscal cliff has left both sides, quote, pessimistic" about a deal.
9:12 am
gm put an opener on the table that didn't really move the ball in either direction. how attuned is the market to that right now, given everything else going on? >> you know, i think that the market is really pretty confident that we're going to get some sort of deal that avoids a fiscal cliff. the reason for that's clear. you know, 2011 neither side really wanted a deal. the republicans already had their big ask, which was the extension of the bush tax cuts. president obama wasn't interested in a deal because he didn't have much leverage. that meant any deal would favor the republicans and alienate his core constituencies. you fast forward to now, look, all negotiations go through ups and downs, but the bottom line is that both sides need a deal. if the republicans push us off the fiscal cliff, they will be blamed for the subsequent recession and they'll pay the price in 2014. president obama also needs a deal because history doesn't
9:13 am
remember who the speaker of the house was during a period of weak economic growth. the president gets the credit or the blame. he's going to be written about for 300 years and he does not want to preside over eight years of the weakest growth in u.s. history. so, he needs a deal so that the next four years are better than the last four years. >> we'll see. obviously, still the opening days of this process. charlie, the fed chairman in new york yesterday referring to these talks, reiterating how important it is they get done. he coined the term, fiscal cliff, "the washington post" today says. also adds that the evans rule is an area they continue to look into. fallout today from what he said yesterday? >> ilgt bit but that will happen. the market will be going up and down on small indicators. is john boehner smiling or frowning today? we'll have a lot of volatility for the next two or three months because i do think it's going to be two or three months. i think this is going to go into
9:14 am
january. i think close to a 50% chance we'll go over the fiscal cliff temporarily. the market won't react well to that so it's going to be very, very bumpy couple of months here. >> that said, seasonally, i was told not too long ago, the period between thanksgiving week and december 3rd, the past 20 years has been positive for stocks for 17 of those 20 years. is there going to be any kind of hope for a santa claus rally here, michael? >> i think there is. that's simply because pessimism has reached a level of extreme that historically has led to higher markets over the next three months 81% of the time. the average market gain when pessimism has gotten to this low a level has been about 7%. i think when you look at the basic, you know -- we have three rules to guide our tactical trading. don't fid the fed. obviously on our side. don't fight the trend. powerful up-trend since 2005.
9:15 am
now sentiment has reached a pessimistic extreme. very, very supportive of that seasonal tendency of the market to gain over the next three months. >> charlie, you've been a long-time holder of financials. i'm just curious between now and the end of the year, is your inclination to trim those positions given they've had a massive run since the beginning of the bull market? >> great question. short term, as i said, i think they'll be volatile but we don't think it's a good idea to trade short term. they're still very cheap. i agree with michael, after we get through this, we will, we'll have a rally in the market. the whole market is cheap. when we get past this, and we will, stocks will do very well. like kkk, blackstone, morgan stanley are extremely cheap. again, going to be very volatile for the next six weeks. >> have a great holiday. thanks, guys. >> happy thanksgiving. mean sometime the secretary of state making the rounds today in jerusalem, ramallah and cairo, pursuing a cease-fire in the israeli/palestinian conflict.
9:16 am
nbc news correspondent stephanie gosk is in tel aviv with the latest. good morning. >> reporter: this blast took place around lunchtime. a commuter bus here in central tel aviv. right now authorities are saying that it was a terrorist attack, although not a suicide attack. at least 11 people were injured. several of them seriously. you know, this will look very familiar for people here in tel aviv and israel. this was a tactic used a decade ago. these bus blasts that scared people. a lot of people not taking buses at the time. this will complicate the furious diplomatic effort. you mentioned secretary clinton is on the ground. she's trying to shepherd a cease-fire process. this will make it more complicated. after the blast a spokesperson for hamas called this a heroic attack. >> thank you, stephanie gosk with the situation in tel aviv.
9:17 am
>> let's take a check on crude oil. of course, it has moved almost in lockstep with how, you know, deep the crisis has gotten over there. wti is a picture we're looking at right now. really the biggest action over the past three days has been in brent. that's much more tied to the international oil market outside the united states. that's where we see the real increases over the past three days. in fact, the premium of brent to wti, that has widened to as much as 23.58. that's the widest level we've seen over the past three days. there we go, brent is up 1.3%. >> we've got the retail countdown to black friday for you. let the tablet wars begin. which device will santa be carrying this year? all the christmas references will work their way into our teases. we'll take a closer look at the tech showdown. one more check on futures, moderate weakness. we'll see how we close out. a full session, probably a light volume ahead of a shortened
9:18 am
session on friday. [ female announcer ] want to spend less and retire with more? at e-trade, our free online tools and retirement specialists can help you build a personalized plan and execute it with a wide range of low cost investments. get a great plan and low cost investments at e-trade. since ameriprise financial was founded back in 1894, they've been committed to putting clients first. helping generations through tough times. good times. never taking a bailout. there when you need them. helping millions of americans over the centuries. the strength of a global financial leader. the heart of a one-to-one relationship. together for your future. ♪
9:19 am
9:20 am
take a look at fair value. dow implied open down about 19 points. i don't know if we have -- i guess we don't have a camera ready to take a live shot of the floor right now where santa, of all people, has showed up. >> he's not coming to town, he is in town. >> there he is. >> i don't see how we close
9:21 am
negative today with that. >> getting ready for the last float in the thanksgiving day parade, which is always san sta clause. >> he probably has thoughts on the fiscal cliff, with presents -- >> hopefully not coal in the stockings of boehner and obama. >> is he ringing the bell? >> the executive producer of the macy's thanksgiving parade is here to do the honors. i assume santa will be joining her. >> in television that's what we call a get, if you can book that guy. >> look at him. >> bring on the rally, i guess, traders are saying to him. >> i know whose lap i'm sitting on later, i'll tell you that. >> really? wow. >> all right. >> all right. who will rule the last trading day before thanksgiving? the bulls or the bears? coming up next, art cash on what he's expecting from the matters as we count down to the closing bell. boston market on the business of thanksgiving. much more "squawk on the street" straight ahead.
9:22 am
nobody said an inkjet had to be slow. or that printing in color had to cost a fortune. nobody said an all-in-one had to be bulky. or that you had to print from your desk. at least, nobody said it to us. introducing the business smart inkjet all-in-one series from brother. easy to use. it's the ultimate combination of speed, small size, and low-cost printing.
9:23 am
i heard you guys can ship ground for less than the ups store. that's right. i've learned the only way to get a holiday deal is to camp out. you know we've been open all night. is this a trick to get my spot? [ male announcer ] break from the holiday stress. save on ground shipping at fedex office.
9:24 am
♪ about six minutes before the opening bell rings on wall street. let's bring in art cashin of the ubs financial services. on the day of the rally we had great headlines about the fiscal cliff. today there might be speed bumps and we're looking to open lower. looks like a long month ahead for us. >> well, it's going to see like a long week, even though it's an abbreviated week. we have this vacuum on the fiscal cliff. that's a mild positive under the
9:25 am
market. next week congress comes back, heaven help us. there might be untward comment from somebody, doesn't have to be the speaker, could be somebody else saying the votes aren't there. it could be a key issue. what's going on in europe will be another key issue. looks like the market wants to tiptoe through the holiday. there's a mild upward historic bias to today, also to the abbreviated session on friday. monday not so much and i think that fits in with congress coming back. >> is there bias to the next week, all of the next weeks going into december. why is that? >> people look for the santa claus rally. in the couple of years we've had santa on a milk carton but today he's ringing the opening bell. i heard him tell one of the good little traders that -- >> they still make those?
9:26 am
>> he looked 6% busier than last year but we couldn't find out if it was domestic or worldwide. we'll have to wait and see. >> i doubt it was europe. >> probably not europe. >> a year ago we were suffering through europe then. we haven't talked about it as much then, but greece still hasn't figured out how or when they'll get the money. spain hasn't come up in a long time. but i can't imagine we won't revisit it. >> but they're doing kind of what the leadership here has been doing. that's putting the kind face on things. i mean, for example, fiscal cliff vacuum will allow the press and others to speculate that the staff are working on some kind of deal that can be sanctified when the leaders come back. i am, as you are, worried about europe because they keep marching up to their cliff saying, we'll be back tomorrow. we have a way to turn here. >> on your milk carton comment i'm reminded the dow fell 236 the day before thanksgiving last year.
9:27 am
>> yes, yes it was. >> we'll see what today brings. we'll talk to you a little later on. a lot more "squawk on the street." back am-n a minute. [ male announcer ] this is steve.
9:28 am
9:29 am
he loves risk. but whether he's climbing everest, scuba diving the great barrier reef with sharks, or jumping into the market, he goes with people he trusts, which is why he trades with a company that doesn't nickel and dime him with hidden fees. so he can worry about other things, like what the market is doing and being ready, no matter what happens, which isn't rocket science. it's just common sense, from td ameritrade.
9:30 am
you know the holidays are here when santa rings the opening bell. if only every day could be like this. the big board, macy's thanksgiving day parade, in it's 86th parade. we'll talk to the executive producer of the prad inarade in moment. yy inc celebrating its ipo today. watching for some movers. brent relatively mixed here. a little more color on hp. "the times" takes a crack at it, giving us some anecdotes how out of the loop mike lynch kept himself. >> yeah, maintaining separate headquarters. we heard from mr. lynch yesterday on maria bartiromo's
9:31 am
program. he, of course, denied in any way, shape or form that they had done anything wrompk autonomy when it came to revenue recognition and the like. we'll have a little more on it in a bit. we have a statement from deloitte we want to share, autonomy's auditor. we'll keep an eye on hp after the new lows yesterday. some argue autonomy, some with disappointment over the first half of the year and declines in some of their businesses. we talked to meg whitman at length about that yet. >> it's amazing the write-down is what had analysts revise their -- they cut it to a whopping sector perform now. >> thanks for that. >> the straw that broke the camel's back here. >> right. maybe it's time to buy. >> yeah. they also say hp remains
9:32 am
strategically challenged while declining market share makes it difficult to recover. hp for their part are not doing so bad. >> jane oos calling into squawk telling the story how the original short was autonomy. he called it an aggressive roll-up. stunned when hp bought it. lost money in a short period of time. has since made that back and more by shorting the larger story of hp. still short. >> that's interesting to do that on his part, take the thesis and bring it to hp. even if autonomy was a mess, there's no argument necessarily it would have followed through to hp. being a complete mess. i assume there are other fundamental reasons he approached it but good move on his part. >> you mentioned the real kicker to this, remains short hp.
9:33 am
jim talked to the ceo yesterday but this is a very bullish report that they issued. a beat and a raise. they overcame currency fluctuations as well as currency in europe. competitors mentioned that's why they missed all or parts of the quarter here. there's some optimism of two years of trading in a channel this is time for a breakout and we see that reflected in the shares. >> crm is the number one gainer. number three gainer, chipotle, adding to a buy-back program announced last month. 2.5% gain as some have tried to say maybe they're getting their mojo back after bringing down long-term sales projection says into the low, single digits. >> toyota motor, another one we're watching. that stock is up 1.25%. a fairly flat day on the markets. vice president at chinese unit was quoted as saying sales in china have actually rebounded to
9:34 am
the levels before the dispute between china and japan. very good news for toyota. we saw very dramatic decline in shares in the month of september and october for the japanese automakers. so to think they're regaining that share back is a very positive step for toyota. >> shares of best buy having another poor day. down another 1.5% after a very, very sharp decline yesterday on worse than expected numbers, of course. over 4% decline in comparable store sales. lowering cash flow targets for the year substantially, in fact. you see it down 1.7%. a number of analysts coming out this morning -- let's not forget it's not just equities but also a lot of high yields associated with these names. there's a big bond market out there, people, and in fact that also has been seeing losses. sometimes in part because of this idea there might be an lbo. if there is an lbo you add a lot of debt to the company and, therefore, existing debt will
9:35 am
usually carry a higher yield sarment of the risk rising from default and also because of fundamentals deteriorating. >> we talked about r.i.m. yesterday getting an upgrade. jeffries $10 price target. today "the journal," ntsb, another federal agency s considering dropping the blackberry for the iphone, citing reliability issues. isn't hurting the stock yesterday. >> the ntsb, national transportation safety board, thinks the iphone is -- >> yeah. >> i might rethink my phone choice. let's join bob pisani on the floor. did you find santa? >> santa is here. one thing santa wanted most of all is a deal on the fiscal cliff. that's what he wants. i've been calling around, talking to people saying, what's going to be the drop-dead state? when are the markets going to start getting nervous?
9:36 am
the majority agree congress has got a couple of weeks of good will. next week, going -- santa, tell them. you want a deal on the fiscal cliff. that's what you told me. >> we want a deal on the fiscal cliff. that's what we need. >> it's official, comes from santa himself. listen, two weeks is what they've got. if by december 10th this is the week a lot of people told me about, we don't have a clear indication of what's going to happen, the markets will get jittery and when things will start falling down. the down payment, everybody wants a deal, coalescing around the same thing. cap itemized deduction and extend the debt ceiling. that's the down payment. let the hard part happen next year. if that happened, everybody down here, at least on the trading desk i talked to, would be happy and let the serious work get done next year. no firm deal on greece but greek bonds moved to the upside because there's been leaks about what the deal is going to look like. so far it looks like greece will
9:37 am
be able to buy back its debt at significant discount and not have any penalties. i don't have the exact numbers but numbers floating back buy back at 50%, maybe as low as 35%. that would be a good deal for greece overall. that still would be very beneficial for them. we don't get any agreement or extending maturities or extending interest rate. the biggest is whether government will take a haircut which is what you need. that's the third rail. nobody wants to touch that right now. finally, i want to note, still a lot of uncertainty globally about the economic outlook. i don't mean just about deer. did you see johnson mathy, the largest producer of catalytic converts. they trade in london, not here. bottom line, they're uncertain about the direction of precious metals and also uncertain about
9:38 am
truck sales in the u.s. that's a big part of the cat latic converter business. carl, it's not just what's going on with deer and their guidance being a bit on the cautious side but also from one of the big producers in the world, chemical producers in the world. happy thanksgiving. >> same to you, bob. we'll talk to you later on. bob pisani with santa exclusively on the floor today. let's shift to bonds and the dollar with rick santelli at cme in chicago. good morning. >> i hope santa doesn't give congressmen more checks in their checkbook for christmas. if we look at market, no check. long on the treasury complex or bund complex for that matter. looking at a 24-hour chart, two-day chart or two-week chart, you see the same thing. treasuries have reversed a bit. we're close to a two-week high in yield and busting out over that tight range we had for about six trading days.
9:39 am
here's what's fascinating. we're about ten basis points off the low in that two-week period since we last saw these yields. 1.58, 1.68. europe at 1.42, identical. yield on two-week extension on today's high yield was 1.32. they're about nine basis points above their low. there's symmetry. which way it's going to happen on greece, which way it's going to happen on the cease-fire, it seems dynamics are to take your foot off the accelerator. biggest foreign exchange trade, 24-hour chart and year to date chart of dollar to yen, in favor of the dollar. this is a trade that keeps on giving. >> thank you very much. let's check out the latest move in energies and metals. let's go to sharon at the nymex. >> brent crude is the benchmark in light of what we're seeing in
9:40 am
the israel gaish gaza conflict. once again, the contract showing the most momentum in the oil market. up $1 here on the bus explosion in tel aviv. yesterday was all about potentially a creaease-fire in israel/g israel/gaza conflict. now we're focused on more violence and whether that will escalate and spread regionally and impact oil flows in the region. we're looking at what's happening in europe. and the fact there's been no agreement there on the greek bailout deal is something that could potentially put pressure on prices and it's a reason why we're still not at the highs we saw on monday in terms of the oil price. we're continuing to watch the supply picture as well. we'll get the information from the energy department at 10:30. the american petroleum industry report showed declines across the board. that was bullish for prices as well. in terms of natural gas that report comes out at noontime today, a day earlier because of the thanksgiving holiday. we are looking at natural gas
9:41 am
near a 2012 high. a mixed pictures for the metals market. a lot of focus on europe. . into next week that's the focus for the metals market. >> thank you very much. want to turn our attention back to hewlett-packard for a moment. yesterday was a big day for the company when we brought you news that the company was alleging essentially it had been defrauded by autonomy and by management when it played $11.1 billion to buy the unstructured data firm, unstructured data provider or collator, software company, back in october of 2011. you can see hp shares. let's call it almost flat on the day probably a bit of a relief. a lot of personal analysis going on today, looking at those numbers, looking at some charges. we started to hear from some of the parties we questioned yesterday, namely dr. michael lynch, one of the founders of autonomy, who had run at hp.
9:42 am
we heard from him last yesterday saying in an interview. there was nothing done at the company under his watch that would in any way indicate anything like the types of charges being made by hewlett-packard. he said as well that he was not even aware of the investigation that had been going on since late may when a so-called whistle-blower came to hp's management and detailed some revenue recognition issues brought to our attention yesterday. i can tell you sources close to the company, being hp, they find that hard to imagine he wouldn't have been aware given all the questions being asked by hp's management over the last few months and by pricewaterhouse coopers as it began and continued that investigation on behalf of the company into autonomy's accounting. we have heard from deloitte, the
9:43 am
firm that audited autonomy's numbers. they say they were not engaged by hp or by autonomy to provide due diligence in relation to the acquisition of autonomy. deloitte you can was auditor to autonomy at the time of its acquisition by hp. they go on to say some charges leveled by hp, they deny they had any accounting improprieties. all those statements can stand on their own but they don't mean deloitte shouldn't have been in a better position to do more work to figure out if, in fact, these problems were there. we'll see what happens. >> the bottom line is deloitte is saying -- it sounds like they're standing by their audit
9:44 am
through december of 2010. >> and just saying, well, we did what we normally do as an auditor -- >> they didn't know about it, otherwise they didn't know of any. >> a lot more to come, as we well know. the s.e.c. and the fraud office in the uk and some say the fbi involved in the investigation. >> fascinating story, though that's still developing. let's get to carl who's on the floor. carl? >> thank you very much, melissa. fresh from the opening bell we want to we will comb amy, executive producer of the annual macy's thanksgiving day parade, celebrating its 86th year televised tomorrow on nbc from 9 a.m. eastern until noon. also a man who needs no introduction. i've been told it's santa, not mr. claus, just santa. >> we're all on a first name basis. >> we're going down sixth avenue, wide, straight street.
9:45 am
parades love to go straight, not make a lot of turns. the sidewalks are wider so more people can see it. more people can see santa. >> 3 million people watching in town, 50 million on television. new floats, elf on the shelf, hello kitty, papa smurf. >> brand new balloons. and the artist cause is bringing to bring his alter ego to life. >> obviously, new york's been through a lot the past few weeks. did sandy alter preps? >> our parade studio is in new jersey in a town that was deeply affected. we couldn't get in for three days. i've got to tell you, once the doors were open, everybody in that parade studio was working harder than ever because they knew they needed to see the parade come to life. we had a setimpak but not as bad as a lot more people. >> a lot of interactivity, zeebox. >> which will enhance second screen viewing the parade.
9:46 am
tune into zeebox on your app. we have a new app for your ipad and iphone as well. you can turn yourself into a parade balloon. >> maybe next year. you'll be leading it. >> i will. >> i'm somewhere in the parade. you'll just have to watch and find out where i'm going to turn up at. >> i know pisani asked you about the fiscal cliff. have enough lawmakers been good this year where they deserve something from you? >> no. >> silence was deafening. >> they're in the book. i can't tell you which book they're in. but they're in the book. we're going to check it twice. >> santa, thank you. amy, thanks to you. >> happy thanksgiving. >> same to you. >> ma merry christmas. >> straight from the words of santa. >> looks real. that's really santa. >> of course it is, david. hello! should you bet on the world's largest ag equipment
9:47 am
maker? that's later on. the ceo of boston market, what is the restaurant chain doing to get people to stop by for thanksgiving weekend? bob, these projections... they're... optimistic. productivity up, costs down, time to market reduced... those are good things. upstairs, they will see fantasy. not fantasy... logistics. ups came in, analyzed our supply chain, inventory systems... ups? ups. not fantasy? who would have thought? i did. we did, bob. we did. got it. monarch of marketing analysis. with the ability to improve roi through seo all by cob. and you...rent from national.
9:48 am
because only national lets you choose any car in the aisle... and go. you can even take a full-size or above, and still pay the mid-size price. i'm going b-i-g. [ male announcer ] good choice business pro. good choice. go national. go like a pro. [ female announcer ] today, it's not just about who lives in the white house, it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office,
9:49 am
but we honor the cubicle, and the home office as well. because today it's about all of us. and no matter who you are, you're the commander-in-chief of your own life. ♪
9:50 am
deer saying it sold more equipment at higher prices but earnings missed analyst expectations. shares trading lower down by more than 4% this morning. let's bring in managing director of machinery and multi-industry analyst with jpmorgan. good toe see you. >> good morning. >> what was the big driver behind the eps miss? >> the biggest problem we saw in the numbers was the increase in actual selling and general administration expenses as well as r&d expenses. combined those expenses rose $100 million quarter over quarter. this was more of an execution issue and an overhead cost issue. more so than it was a revenue miss. >> did you get the sense they were embarking on any expensive marketing programs or financing
9:51 am
programs to account for that rise in sgna? >> we knew on r&d side they coming because of industry changes on the industry side, not just john deere. we had heard industry sales were very strong. farmers are anxious to buy equipment before the end of the year because bonus appreciation expires at the end of this year. we expect to hear whether marketing programs were in place or aggressive financing programs actually supported the higher level of sales. that's probably one of the concerns that we see for john deere with the quarter and going forward. >> what's your sense of sales this quarter and these next few months and into '13? i'm wondering if there are any cancellations or hesitancy among farmers to carry it forward given the fiscal cliff situation. >> i think the farmers in general are not as concerned
9:52 am
about the fiscal cliff as the rest of the world, frankly. my experience with farmers, from being out in the midwest way too much, is that farmers obsess more on tax and tax payments. what we saw this year with the drought, we expected farmers to pull back their spending because of the severity of the drought, but indeed most had crop insurance so they have ample cash. now they're anxious to spend that money before year end, before bonus depreciation expires at the end of the year. if it expires as part of the fiscal cliff, i guess they are concerned about it. >> thank you for joining us. how does the american people heading into black friday? you t find us online, you'll also find us in person, with dedicated support teams
9:53 am
at over 500 branches nationwide. so when you call or visit, you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying... [ all ] i'm with scottrade.
9:54 am
it's no wonder so many investors are saying... get 36 months interest-free financing through thanksgiving weekend at sleep train, and save $400, $500, up to $600 on beautyrest and posturepedic. even get 3 years interest-free financing on serta icomfort and tempur-pedic. plus, free same day delivery, set-up, and removal of your old set. when brands compete, you save. but mattress price wars ends sunday,
9:55 am
thanksgiving weekend, at sleep train. ♪ sleep train ♪ your ticket to a better night's sleep ♪ welcome back. we have the november final michigan sentiment survey. it is much lower than that wild preliminary read. 8.27. now, if you recall our preliminary read at 84.9 was the
9:56 am
best since july of '07. 82.7 only shaves a few comps off. that's the highest read since september of 2007 but less than what many were looking for. we have leading indicators yet to come. back to you. >> thank you very much, rick. keep note of those consumer sentiment numbers. as you said, l.e.i. is coming up later. our capital system isn't perfect but one of the best out there and we're all participants. that bridges us to squeak on the tweet. we're asking you to tell us what is it about our capital system you're most thankful for? tweet us @squawkstreet and include hash tag why i'm thankful which will air throughout the morning. still to come, how the fiscal cliff could impact your takehome pay. first, millions of americans are taking to planes, trains and automobiles this thanksgiving holiday. we'll find out how things are
9:57 am
going so far and what it means for the companies helping you get from point "a" to point "b." ♪ you can stay in and like something... ♪ [ car alarm deactivates ] ♪ ...or you can get out there with your family and actually like something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this is the pursuit of perfection.
9:58 am
or that printing in color had to cost a fortune. nobody said an all-in-one had to be bulky. or that you had to print from your desk. at least, nobody said it to us. introducing the business smart inkjet all-in-one series from brother. easy to use. it's the ultimate combination of speed, small size, and low-cost printing.
9:59 am
i heard you guys can ship ground for less than the ups store. that's right. i've learned the only way to get a holiday deal is to camp out. you know we've been open all night. is this a trick to get my spot? [ male announcer ] break from the holiday stress. save on ground shipping at fedex office. welcome back to "squawk on the street," about 15 seconds
10:00 am
away from l.e.i., leading economic indicators. it's not usually a market mover. we expect it to be a slightly positive month-over-month change. survey says, expectations right. up 0.2 on leading economic indicators. last month you shave that tenth up, now up 0.5. this number isn't going to hurt the market. where is the market? making new highs on the executive side and high yields, two-week high yields on the treasury side. a 1.69 yield on the ten-year. >> keeping you busy today, that's for sure. here's a look at how the markets are faring on this final day of trading before thanksgiving. dow, s&p and nasdaq are up four straight. we haven't done that since
10:01 am
mid-september for the nasdaq. we'll see if these gains hold. our road map for the next hour. it's officially the busiest travel day of the year. black friday, now only two days away. we'll check the airports as passengers get ready to load up. >> the fiscal cliff gets closer but how would it affect your take-home pay? >> in the market for turkey tips? who isn't? how much stuffing should you use in when should you baste? what are the best side dishes? we'll do a little turkey talk with butterball's famous turkey talk line. one of my favorite segmentings of the entire year. >> i was wondering all those questions just this morning. first let's get an update on the travel holiday rush and for that phil lebeau joins us from chicago. >> reporter: it's relatively smooth weekend in terms of travel. no major storm systems. there was some fog here in
10:02 am
chicago, about 200 delays earlier this morning. generally speaking, it's going to be a smooth weekend. that's good news for the airlines. last hour, guys, we were talking about the number of seats that have been stripped out of the system over the last five years. check out these statistics. 14% of the capacity in the u.s. for the airlines has been stripped out since 2007 as the airlines have gotten better at limiting capacity. if you look at what's happened with airfare since 2007, they're up about 16%. fewer seats, more revenue for the airlines. with that said this year, the average domestic round-trip ticket coming in at about $188, according to aaa, down 10% compared to last year. there's some good news. popular thanksgiving destinations, they are all seeing higher fares. if you're going to new york, which a lot of people do because of the macy's thanksgiving day parade, other festivities, you'll see higher fares for some
10:03 am
of those cities. airfares for christmas are already trending higher acordsing to orbitz. if we look at the airline stocks, which are doing better as jet fuel cooled off. take a look at busiest airport, o'hare, not surprising, followed by l.a.x., san francisco, laguardia, boston. the traditional destinations, they always get the most business on thanksgiving. that's why, for those who are looking for that last-minute getaway, yes, there are still people looking right now to get away on friday for the weekend, vegas. they got rooms going for $96, guys, because not many people associate thanksgiving and vegas together, therefore package deals are going very, very low this year. back to you, melissa. >> turkey and elvis is a good combination. >> we're on our way. >> sounds like phil has his ticket, the way he's talking. >> somebody will be on a parking garage roof by the end of it.
10:04 am
phil, thanks so much. always good to see you. let's get more insight on the state of the airline industry. michael boyd is an aviation analyst and president of the boyd group. good to see you. fact or fiction, it's actually busier around this time of year than normal? >> fiction. the crush isn't much of a crush anymore. last wednesday airplanes were full. this wednesday airplanes will be full. there's no more airplanes in the sky. it's a different clientele, to be sure but in terms of the huge rush of additional people it's marginal at best. >> in terms of how much the airlines can make this season, is there any markup on tickets? are tickets more expensive this time? >> i mean, noo matter what you do it will go up, as phil was saying. fares will go up because airlines have fewer seats and they're managing their capacity. we figure with ancillary fares and everything you do to get a seat as well as your ticket, 8% this year over last year. >> we were talking about how there are fewer seats out there that airlines have reduced
10:05 am
capacity, and that is translated into a better financial health for many carriers, michael. which carriers, though, have really capitalized on that, have benefitted from the reduction capacity? >> i think you've got like southwest airlines, they're not adding anything. they got religion. american airlines, same thing, that's why they get unit revenues up. virtually all of the airlines are doing it now. spirit are taking advantage of the edges but overall, they all got religion. >> of the integrations you've seen over the past few decades, has delta done the best job? i wonder where that process rates in terms of what we all know is a very difficult transition. >> let's understand. over the last mergers like united continental, delta, northwest, they didn't really reduce capacity a great deal. they just took advantage of the revenue synergies. the only that's -- overall it's
10:06 am
been almost stable. the consolidation has been on the revenue side. not necessarily capacity side. >> and speaking -- >> when you say that they've got religion, one question investors have is, will they keep it? in the past it seems as though they stray. people are starting to focus on the fact there have free cash flow being generated by some of these airlines, something we haven't seen in quite some time, at least consistently. is it a new world for them? >> it is a very new world. there are now opportunities to expand yet brookings has come out and said foreign carriers should come to the u.s. and fly. there are no real opportunities out there for heavy duty expansion. like the five families. they've got their turf and they'll fight occasionally but only at the margins. >> and in a previous era you could always get a new start-up. fansing was easy. get a couple of planes out of the desert and force the majors
10:07 am
to flood the market with capacity. that's not happening, is there? >> no opportunity for that. only a lunatic would try to start a big size airline today. it doesn't make any sense. there just aren't any options out there to make a lot of money with the costs of flying today and the kind of economy we have. >> if american gets merged with somebody, we know there are obviously some airlines interested there, one in particular, is that going to take capacity up? >> no, i don't think so. doug parker at us airways, let's be blunt, he wants to put together and get additional synergies but they won't be slashing capacity and squeezing the public. remember, these mergers haven't allowed the airlines to squeeze the public. they're still trying to price just to make a profit. >> thank you for your time. have a good holiday, michael boyd. >> you too. later on, hostess heads back into court, looking to succeed with liquidation. they failed to produce an
10:08 am
agreement. kayla is outside u.s. bankruptcy court in white plains, new york, with yet, kayla, another disappointment, right? >> reporter: it is, carl. this building behind me has come to be known as the de facto hostess funeral home. sgit that hail mary effort yesterday between hostess executives and the bakers u.n. to try union, they tried to come to a deal. they couldn't. now it's back to square one, what the judge was discussing on monday, a potential liquidation. they wanted to avoid it. they wanted to avoid costing as many jobs as it would. 18,500 people. that's how many people hostess employs. here's some issues that are going to be on the docket for certain. there is a motion by a trustee to liquidate the company in chapter 7, not chapter 11. what that means is new management would be appointed to affect the winddown, not the
10:09 am
current management in place. another motion deals with executive pay. right now the executives are slated to get about $1.75 million as part of the wind-down effort. also a motion over what the employees who would be retained at hostess, those 3,200 people, would actually get paid once they stayed on board and help with the wind-down. the ceo of the company said the wind-down or shutdown, liquidation, whatever you want to call it, costs about $1 million a day. it's not like you're not spending money just because you're closing the company. after today's hearing is when we expect buyers will come out of the woodwork for specific brands, for specific intellectual property of hostess. we know there's no buyer for the entire company. they already tried that. as far as interested parties, flower food, metropolis, who owns pabst blue ribbon, the beer company, but over two dozen parties have called hostess
10:10 am
after they said they would liquidated and said we're interested in buying some brands off your hands, not what's encumbered by the unions. >> thank you for that report. let's head over to brian shactman with a market flashback. >> pabst blue ribbon and twinkies. scholastic, slashing 2013 eps guidance. now it's 140 to 160, down from 220 to 240. they're talking about education technology is weak, children's books are weak. a lot they said had to do with sandy. hunger games not selling as much as they expected. down 20%, carl. already five times their average daily volume. back to you. >> that's a strange reversal. we'll keep our eye on that one. no vacation for business leaders when it comes to worry being the fiscal cliff. what's the best way to solve it? we'll ask democratic senator of maryland. also ahead, the tablet war is
10:11 am
heating up as we approach black friday. which device will santa be carrying? we had santa on the floor. he wasn't holding a personal device. ♪ [ male announcer ] this is karen and jeremiah. they don't know it yet, but they're gonna fall in love, get married, have a couple of kids, [ children laughing ] move to the country, and live a long, happy life together
10:12 am
where they almost never fight about money. [ dog barks ] because right after they get married, they'll find some retirement people who are paid on salary, not commission. they'll get straightforward guidance and be able to focus on other things, like each other, which isn't rocket science. it's just common sense. from td ameritrade. thrget 3 yearsgiving weekend, interest-free financing and save up to $600 on beautyrest and posturepedic. even get 3 years interest-free financing on serta icomfort and tempur-pedic. mattress price wars ends sunday at sleep train.
10:13 am
10:14 am
congress is on recess for the thanksgiving holiday but back in session when the fiscal cliff talks will resume. we're joined by a member of the senate budget committee. always good to have you. happy thanksgiving. thanks for being with us. >> a pleasure to be with you. >> we got a little kum-bi-ya over the past few days. people are worried about what happens next week when these talks begin in earnest, you might argue and the differences come into full relief. is that a reasonable expectation? >> well, we hope the holiday spirit will keep us working together. we really do need to reach a compromise. we need to move forward, avoid the fiscal cliff and work together, democrats and republicans, with a true agreement where we listen to each other. >> what have you heard from leadership this signals -- we're looking at a picture of the four leaders coming out of the meeting on friday. have you heard anything that
10:15 am
suggest this is time will, in fact, be different? >> well, we have tough issues we have to overcome. clearly any agreement will have to include more revenues. we know that. there's different ways to get additional revenues, and i know those discussions are taking place. we also need to reduce spending. the easiest way to reduce spending is bring down health care costs. we are looking on ways to build on what we did in the last congress in order to reduce health care costs. we also believe we can reduce military spending. we have to put this together in a bipartisan package similar to the work that was done by bowles/simpson. >> there's been some discussion that jake lou is not leading negotiations, looks like it will be geithner. is that going to make a difference? >> well, i think it's important that we have the direct involvement of the white house, secretary geithner is fully engaged on this. and i think he is -- will represent the administration well.
10:16 am
you also, of course, have to have the house and senate as part of this equation. i think all the players have to be at the table. the important point is, the american people want us to come together. we want to deal, we want to avoid the fiscal cliff. we do that, we believe our economy can take off. stakes are very high. we want to make sure all the players are together on this. >> when she spoke on friday, nancy pelosi said there should be a way to communicate to the markets the degree to which progress is being made. if there's any progress being made at all. how do you think that's going to happen? what should markets expect in terms of trial balloons, notifications from the white house, from congressional leaders? can the markets start to anticipate some movement on that front? >> have you to understand we only have a three to four-week period left in this congress. this is the lame duck session. i think what we would hope to be able to do to make a down payment on the debt to make a down payment on the fiscal
10:17 am
cliff, to give some predictability as to how we'll work our way out of the current budget stalemate so the market knows at least we're working together in a positive way. i don't believe we can get everything done in the next three to four weeks but i think we can make significant progress, avoid the across the board cuts, the so-called sequestration and give a blueprint on how we can work together with our political challenges. >> politico has a story, in their words, the absence of any significant concessions in what they're calling sort of an opener, an opening proposal from the gop at the table. nobody knows how serious -- how weighty their sources are, but should the market be worried about that? >> i think we have to wait to see how the specifics come down. it's a short period of time. we'll know in the next two weeks. seems to me from the republican point of view, they've already acknowledged that we need more revenues. the question is, how do we get there? there are different ways we can get the revenues we need to fill the void. at least in the short term to
10:18 am
avoid the across-the-board cuts. i look at it as an opportunity. i know that my democratic colleagues are more than willing to go and -- at least halfway to get this done. the spirit of the holiday is maybe what we need to get this done. >> you say that as we have a banner underneath you that says, fiscal cliff 40 days away. so the clock is tick, senator. happy holidays. have a great thanksgiving. >> same to you. >> senator cardin of maryland. over to brian shactman for another market flash. >> taking a look at sales force, crm. not only did sales force beat on the top and bottom line here, their year-over-yearbooking growth was 31%. extremely strong. their eps guidance for 2013 slightly above consensus as well. up 7% on the day. obviously on a day where volume might be light, this one already above its average as well. back to you. >> thanks, brian shactman.
10:19 am
having a thanksgiving feast without touching the oven. boston market hopes that's the way millions of americans will celebrate tomorrow. we'll talk with the ceo of the chain. will holiday spending be morrow bust than last year or will consumers tighten their belt? well, if it isn't mr. margin. mr. margin? don't be modest, bob. you found a better way to pack a bowling ball. that was ups. and who called ups? you did, bob. i just asked a question. it takes a long time to pack a bowling ball. the last guy pitched more ball packers. but you... you consulted ups. you found a better way. that's logistics. that's margin. find out what else ups knows. i'll do that. you're on a roll. that's funny. i wasn't being funny, bob. i know.
10:20 am
sven gets great rewards for his small business! how does this thing work? oh, i like it! [ garth ] sven's small business earns 2% cash back on every purchase, every day! woo-hoo!!! so that's ten security gators, right? put them on my spark card! why settle for less? testing hot tar... great businesses deserve great rewards! [ male announcer ] the spark business card from capital one. choose unlimited rewards with 2% cash back or double miles on every purchase, every day! what's in your wallet? here's your invoice.
10:21 am
10:22 am
hillary clinton making the rounds today pursuing a cease-fire in the palestinian/israel conflict. jim is in cairo with more. >> reporter: secretary of state hillary clinton has arrived here. she's been here a couple hours. she's wrapped up two meetings, one with president morsi and one with the foreign minister amir. she will give a press conference. we hear they're standing by for that press conference, which everyone here and in israel is
10:23 am
intent on following. after yesterday's swirl of diplomacy, both sides, israel and hamas, seem to have gotten bogged down in the details. apparently, according to some egyptian sources, they haven't been able to bridge their differences. hence the arrival of hillary clinton. a major egyptian online weekly is reporting tuesday, yesterday, egyptian negotiators handed hamas a final proposal to the israelis in jerusalem. since then hamas and egyptians have basically been awaiting israel's final response. of course, it's in that context that hillary clinton now is here. and her presence here is so urgent. she has seen netanyahu twice more since last night. she saw mahmoud abbas, the president of palestine, of the plo, in ramallah. it's really unclear whether secretary clinton is carrying any specific proposals or is here basically to nudge both sides into some kind of compromise.
10:24 am
in less than 15 second, i hope, the main sticking point seems to be hamas's key demand that the six-year-old blockade is lifted. israel is balking at that. it's reportedly saying it agrees in principle to the lifting of that siege, but not to the timing. they say they want to postpone that, some say until after the elections. >> jim, thank you very much. at $267 million u.s. prosecutors call it the most lucrative insider trading scheme ever. we get reaction from the judge who presided over the raj raj rat man trial and which tablet will santa be carrying this year? americans are always reado work hard for a better future. since ameriprise financial was founded back in 1894, they've been committed to putting clients first. helping generations through tough times.
10:25 am
good times. never taking a bailout. there when you need them. helping millions of americans over the centuries. the strength of a global financial leader. the heart of a one-to-one relationship. together for your future. ♪ ♪ you can stay in and like something... ♪ [ car alarm deactivates ] ♪ ...or you can get out there with your family and actually like something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this he pursuit of perfection.
10:26 am
10:27 am
after years of effort the government now directly linking steven cohen to an insider trading probe. well known to many in the financial industry, cohen is a mystery to the general investing public. kate kelly with information on that. >> reporter: it's true. steve cohen is a less known figure in the general public. he very rarely gives an interview and so far has declined our information to come on cnbc and talk about the latest legal situation. but within his firm, you know, he casts a very long shadow. he's known for being a very aggressive, very hands-on trader as well as a manager of people.
10:28 am
i'm told by people who have worked there in the past and now that if he disagrees with your position or he wants more information on it, he's known for getting in your grille and asking a lot of questions about where you came up with your thesis, why you changed your mind or what's going on. these could create a problem for him in terms of the legal case that was opened yesterday, the complaint against matthew martoma, who sold off positions they had in two pharmaceutical companies, elan and wyeth, allege he had information about a trial they were involved in that wasn't going well. he spoke to the hedge fund owner, assumed to be mr. cohen, on the weekend preceding the sale of these positions. and cohen agreed it was necessary to do so and essentially ordered his senior trader to do that. that said, we haven't heard cohen's side of the story. he said he's very -- you know,
10:29 am
he's confident that the firm and he have done the right thing. and he thinks that this is going to pass. that it's going to work out in his favor. he told staffers much the same thing yesterday afternoon. after the closing bell at 4:00, i'm told he had a meeting with employees in connecticut and talked to them about what was going on and said essentially, look, we've been down this road before. s.e.c. or former employees have been in the crosshairs of federal prosecutors for a number of years as they looked at that firm and others in terms of nmsder trading cases. we said, we're accustomed to this. we're going to move forward. one thing he pointed out s.a.c. changed their legal structure if there are lawyer fees, cohen personally will pay those bills rather than have investors pay it. to the extent possible, i think it's very much business as
10:30 am
usual. of course, this is an unpleasant distraction. >> certainly is. thank you very much. kate kelly. breaking news on crude oil inventories. we'll go to sharon epperson from the nymex. >> we are getting the latest report from the energy department on crude supplies. we are seeing a decline across the board. crude oil supplies decline by 1.5 million barrels last week. gasoline supplies down by 1.5 million barrels. distill fuel supplies down by 2.7 million barrels. analysts were expecting to see builds in crude and gasoline supplies, although the american petroleum institute was kind of a precursor to what we're getting from the energy department today, showing very big declines across the board in all of the petroleum complex. we're continuing to watch oil prices above $87 a barrel and the real focus in this market is what's happening in the middle east. you can see that in the brent crude price as well as brent crude is above $111 a barrel.
10:31 am
keep in mind also, we're seeing on the east coast, after hurricane sandy, after the superstorm, refineries returning back to normal. and that is seen in the refinery utilization number. we're now at 87.5% capacity. so that's starting to get back up to normal as well. as these refineries are processing, we are seeing the crude supplies, perhaps, come down but we're also seeing some usage, perhaps, back up. we're all working in a decline here in the products. that is causing a rally in gasoline and heating oil. we're looking at oil prices well supported above $87 a barrel. back to you. >> thank you very much, sharon epperson from the nymex. back to the looming fiscal cliff. if lawmakers don't reach a deal this december, paychecks could shrink for millions of workers. tom, it is amazing. if you take a look at how
10:32 am
retailers are doing, what consumer spending is doing, doesn't look like consumers are that worried about the fiscal cliff. but should they? >> well, you know, i'm not so sure about that as a starting point for the discussion. i would say if you look at october, october was actually a negative month from a retail sales perspective. certainly you could make an argument fiscal cliff was imbedded in that. here at rbc we have this consumer confidence report. in addition to our standard allotment of questions we ask every month we ask a bunch of special questions. one question we've been asking for the last several months is to households, are you following the fiscal cliff? we started asking this question, 60% of the house holds were not following the fiscal cliff back in june. now 40% of households are not following the fiscal cliff. you've seen some improvement but i would argue as much as cnbc wants to talk about the fiscal cliff and everyone else, that means households will pay attention to this a bit more. that's why we thought this confidence number from today was
10:33 am
sort of interesting. you saw a slight scaling back. as this debate about the fiscal cliff continues, it could weigh on confidence as a result and translate into lower spending. that's something policy makers need to be aware of. >> in terms of the actual impact on take-home pay, i imagine it depends on which income brackets and what assumptions you're making. what assumptions are you making and who do you think will have the biggest hit? >> we think higher taxes on the wealthy. first quarter gdp of about 1%. if we weren't talking about the fiscal cliff at all, your benchmark, we would be talking about 2% gdp. 1.5% to 2% gdp. it has a sizeable impact if you just raise tax on the wealthy. this is part of the discussion not resonating with people. this is not just a wealthy taxpayer conversation. remember, part of the fiscal cliff includes social security
10:34 am
tax cut. this is that payroll tax. if that hits, it will hit everyone. not just the wealthy. as a result, if we do see that, we could see softer rates of growth than even our 1% at this point. >> what if we get a deal and get increased business spending as a result of the confidence that comes along with that? i know you're talking about takehome pay but at the same time there are those who believe that will be an engine for the positive when it comes to growth. >> it certainly could. in fact, the one thing that -- in fact, you could see this in every single earnings report that came out. if you listen to these conference calls. all cfos and titans of industry have mentioned the same thing. it's a lack of certainty with regard to the fiscal cliff. that's why you've seen cap ex expenditures slow down recently. if you look at the duke cfo survey, capital expenditure confidence has fallen. from our perspective it could add a huge degree of certainty back into the backdrop. here's the last thing i'll say
10:35 am
on this point. if you consider in these earnings reports, not only these cfos mentioning the fiscal cliff as a source of uncertainty they're also mentioning the global uncertainty. that's really difficult to disentangle these two ideas. you need to get past one before you can understand what the real impact of the other will be. >> in terms of the consumer, tom, i'm curious as we have more consumers paying attention to the fiscal cliff and enter deeper into the holiday shopping season, how will that impact the numbers we're seeing in the next couple of months? >> it could impact them profoundly. i think it really depends on how the conversation on the fiscal cliff evolves. if it evolves in a more positive way, if the tone is more positive, then certainly i think that would potentially be a positive. if it becomes a bit more contentious, then i think we run the risk of having a very disappointing holiday shopping season. >> you know, tom, just one -- if you went to times square right now and polled 20 people about
10:36 am
the fiscal cliff, my guess is 19 would have no idea what you're talking about. >> no question, in fact -- >> isn't it going to be until it hits their paychecks? it's not going to take place beforehand. >> exactly. as i said at the top, i think it's interesting that, you know, in this survey, we poll these households. 40% of households are still not paying attention to the fiscal cliff. i would argue that's high. to your point, it is what it is. unfortunately for most people -- even if you asked them before the fiscal cliff, even if they say yes, i would argue most people don't understand what the actual impact is. i think you're right. i think when we get there, that's when people will really understand the damage. >> tom, good to speak with you. >> thanks, guys. >> let's get a market flash. a big mover in tech. brian shactman at hq. >> looking at my screens, carl, thank you very much. google bounced off the bottom but the chart kind of ugly. in the last week or so google
10:37 am
rebounded a bit and gone back into positive territory for the year but now only 2.5% to the upside to the year and down about $8. just the chart. any time you see a move like that in a stock like google even on a light volume day, it's worth noting. back to you. >> thank you very much, brian shactman. >> peter has a nice ring to it. >> i have no idea why i said that. only known brian for many years. fcc alleging the largest insider trading scheme against mattew martoma. >> ahead, a little turkey talk. need pointers on the best way to cook your bird? we'll hit the butterball hot line for the scoop one day before thanksgiving.
10:38 am
wooohooo....hahaahahaha! oh...there you go. wooohooo....hahaahahaha! i'm gonna stand up to her! no you're not. i know. you know ronny folks who save hundreds of dollars switching to geico sure are happy. how happy are they jimmy? happier than a witch in a broom factory. get happy. get geico. fifteen minutes could save you fifteen percent or more.
10:39 am
i put away money. i was 21, so i said, "hmm, i want to retire at 55." and before you know it, i'm 58 years old. time went by very fast. it goes by too, too fast. ♪ but i would do it again in a heartbeat. [ laughs ] ♪ ♪
10:40 am
♪ [ male announcer ] 'tis the season to discover the kid in all of us. enjoy free shipping and great values on your holiday shopping from l.l. bean. can i still ship a gift in time for christmas? yeah, sure you can. great. where's your gift? uh... whew. [ male announcer ] break from the holiday stress. ship fedex express by december 22nd for christmas delivery. 1 million pounds of turkey, 2.6 million pounds of mashed
10:41 am
potatoes. we're not talking about how much your family ate at thanksgiving last year. that's how much boston market expects to sell tomorrow as they gear up for their busiest day of the year. george michele, ceo, joins us ahead of the holiday tomorrow. good morning to you. >> good morning, carl. it's good to be here. >> you want to walk through some of the metrics? give us a sense as to how busy tomorrow will be relative to every other day of the year. >> well, we're actually going to be busy today and tomorrow. and both days almost equal, one week of sales for us at every restaurant across the country. so, it's a very exciting day, very busy day for us. we feed a lot of families. we're expecting about a million meals served between today and tomorrow. >> how much do you think we'll see growth year over year? >> last year we had an exceptional year on thanksgiving, up 13%. this year we expect to be up between 10% to 12%. the phones are ringing in our
10:42 am
restaurant. we're already starting to see lineups. tomorrow will be a very big day for us. >> now, we're talking both -- there's the dine-in business, where you have families who go to your restaurant to eat. others -- i assume there's some sort of -- i think you call it banquet sales, right? >> yes. tomorrow we have a menu we feature, a turkey meal with a slice of pie for $10.99. we have a lot of people that come into our restaurants. we're open until 7:00 at night so we can give our staff a break to go home and have thanksgiving with their families as well. i will be in the restaurants today and tomorrow. i'm working in miami. it's going to be a very fun day for us. >> you mentioned 10% to 12% growth. doesn't sound quite as robust as last year. can we read anything into that, regarding consumer sentiment or household budgets? are they getting tighter as we go into the holidays? >> we planned 10% to 12% because of the big increase last year.
10:43 am
it was our best year since we opened 26 years ago. we're expecting to do much better than that number. i believe the sentiment is very strong now that the elections are behind us. everybody's very focused on thanksgiving. hopefully we'll have a great year. >> i keep thinking, george, how much fast casual has been through this year alone. commodity costs. we've had a drought. we've had stocks go way up and then way down for various internal reasons. do you think we are past a lot of volatility? is next year going to be a little more calm for the space? >> well, we're going to start to see the price increases coming through the supply chain early next year. you know, we haven't felt yet the commodity increases through our supply chain as much as we expect in the first quarter. but we are ready for it. we took some cost-cutting measures. we believe that, you know, with our sales growth we'll be able to maintain pricing. we probably will increase prices less than 1% next year. but we're confident we'll have a great year at boston market in
10:44 am
2013. >> so no concerns about, if you're having to adjust pricing, you don't see any impact on traffic at all for 2013? >> not really. i mean, a 1% increase is not going to be that much. also, people are going to see price increases at the supermarkets. so, we're trying to offset some of the increases with cost savings. and given our performance over the last two years, we feel very confident and bullish about 2013. >> finally, one question we ask all the ceos all the time about uncertainties regarding what's going on in washington. is your ad budget or your marketing budget or even budget for new stores, new restaurants, is any of that on hold? are you having to develop contingency plans given everything we don't know about fiscal policy right now? >> well, actually, we increased our advertising budget for next year. we'll get some efficiencies in our advertising given we're not up against the olympics in london as we did in the summertime. we also believe that we're going
10:45 am
to have good growth next year. we'll be opening restaurants at boston market for the first time in seven years. we've been on a bit of a hiatus. given our performance in the last two years we're confident and bullish and looking for restaurant space in miami, new york and new jersey. that's why i'm here, part of my visit to miami, is to look at about three locations that we're going to target for next year. >> well, you're more than welcome to come up to new york. we need you uptown. thank you, george. happy thanksgiving. >> happy thanksgiving to you and the team at cnbc. take care. >> thanks so much. >> for those of you feeling a little more domestic this year, we've got an expert on hand to make sure you baste your way to turkey perfection. sue smith is a butterball turkey talk line expert and she joins us now. i would imagine this is an extremely busy time for you. how many calls have you fielded so far today? >> today itself is about over, gosh, thousands of calls just
10:46 am
today. tomorrow on thanksgiving day we'll take over 10,000 calls. that's just through the talk line itself. >> what is the most common question? >> most common question year after year is how to thaw your turkey. if it's not in your refrigerator today, don't panic. you still have time. a golden rule is thaw your turkey in a cold water, breastside down, and you have time to do it today, put it in the refrigerator tonight and it will be fine for tomorrow. >> david, don't panic because your turkey is still in the freezer. >> i still have to bathe it. that could be a problem. >> what's your second most popular question or misconception about turkey cooking? >> another popular question, we'll get this tomorrow, is how do you prevent getting a dry turkey? we recommend a shallow open pan, about two-thirds of the way through you're going to take reynolds foil, shield that breast. that's going to allow -- prevent
10:47 am
the breast from getting too done while you wait for the rest of the meat to get up to temperature. if you have a meat thermometer make sure the thigh gets to 17 180 and breast to 170. a lot of people like to stuff the turkey and make sure it gets to 165. >> are you a big proponent of soaking the turkey in advance in saltwater? >> you know, a lot of people like to brine the turkey. it's a fun way to do. we recommend using a fresh butterball turkey, soak it overnight and gives it extra tenderness and juiciness to it. >> thank you for your tips. we appreciate it. >> thank you. still ahead, tablet wars are heating up as official holiday season kicks off this friday. which device will santa be carrying with him? first, rick is working on the next hour of "squawk on the street," aren't you? >> absolutely. i like what you said, it is the official holiday season start. so on the santelli exchange
10:48 am
coming up at the top of the hour, we'll talk about holiday markets. let's also remember, there's a lot of anxiety, there's a lot of energy out there. things like the fiscal cliff. but remember, if you're not worried about the outcome, then it's not worth fighting for. come back, top of the hour. [ female announcer ] e-trade technology
10:49 am
can help make you a better investor. our e-trade 360 investing dashboard shows you where your money is, live. e-trade pro is so usable you'll actually use it. and our apps are the ultimate in mobile investing. become a better inves at e-trade.
10:50 am
10:51 am
former fund manager matthew martoma was arrested yesterday. profits that add up to about $276 million. that from insider trading, says the government. joining us now, richard harwell, who presided over the trial, judge, you know, of course, many people are focused as they should be, on steven cohen. the man who founded sac. 9 billion of the assets are his.
10:52 am
there are calls between mr. mar toe ma and cohen that the government tells us have taken place. we assume it's mr. cohen judging from the hedge fund's leader, founder, owner. what is the government in your opinion going to do here if they continue to try to indict mr. cohen? >> well, the first strategy would be to convince mr. martoma his best action is to corroborate with the government. to date, they haven't be successful and mr. martoma may be married to the position he's taken. this investigation is no prize, certainly to mr. martoma or cohen. there have been reports that the government had tapped mr. cohen's and there have been
10:53 am
reports that the s.e.c. has been investigating the transactions over the past year and deposed mr. cohen, so there's a chess game going on here and an important piece moved across the board by the government yesterday. but the game's not over and there are a lot of moves that are still to come. >> the government's been investigating for quite some time. there was reports that his home phone line was tapped by the government for some period in 2008. we can assume they don't have any evidence to charge mr. cohen with any wrong doing and so, i wonder, if even if they turn mr. martoma, is it going to be a he said she said? saying he knew that mr. martoma had gotten inside information?
10:54 am
>> well, keep in mind that before the prosecution, every case was made on the base i is of circumstance substantial evidence. you just repieced some eated so the 20-minute phone call in july of 2008. what was that conversation about? immediately after, mr. cohen authorizes the sale of the $700 million position. according to newspaper reports, the traders instructed to do it quietly in reports that he successfully had done that. those are tidbits of evidence that jury can use to persuade them that wrong doing is occurring. >> now, obviously, they have not yet decided they have enough evidence. so they have not proceeded yet and may never proceed. >> right, i should point out by the way, i know there's been
10:55 am
some press coverage of the idea they disposed of this stock in a furtive manner, but in fact, that's how they do their trading at sac to avoid everybody knowing when getting out of a big position and i would assume that if the government were to follow up, they could give them many, many examples. where do you think we go from here? what does your get tell you, judge, if you could share that with us in terms of what he's facing and what he may be willing to do? >> it's pure speculation, but as i say, this isn't news, this development, to mr. martoma or charles stillman. he has not turned yet and maybe that's because he's got nothing to turn on or because he doesn't think it's in his interest to tern. it's hard to tell. if the facts are as the prosecutors may think they are, they'll continue to apply
10:56 am
pressure and negotiations can go on with -- right up to the point of trial. there have been negotiations to date, not fruitful yet, we'll see where they go once the case goes to the grand jury and indictment is brought down. >> all right, we'll rely on your insights in the future. thank you. >> thank you. up next, the kindle, the surface and many more. there's a number of compelling choices, but which one would old st. nick choose? that's still ahead. ♪ [ female announcer ] today, it's not just about who lives in the white house, it's about who lives in the yellow house, the green, and the apartment house, too. today we not only honor the oval office, but we honor the cubicle, and the home office as well. because today it's about all of us. and no matter who you are,
10:57 am
you're the commander-in-chief of your own life. ♪ or that printing in color had to cost a fortune. nobody said an all-in-one had to be bulky. or that you had to print from your desk. at least, nobody said it to us. introducing the business smart inkjet all-in-one series from brother. easy to use. it's the ultimate combination of speed, small size, and low-cost printing. you know it can be hard to lbreathe, and how that feels.e, copd includes chronic bronchitis and emphysema. spiriva helps control my copd symptoms by keeping my airways open for 24 hours. plus, it reduces copd flare-ups. spiriva is the only once-daily inhaled copd maintenance treatment that does both.
10:58 am
spiriva handihaler tiotropium bromide inhalation powder does not replace fast-acting inhalers for sudden symptoms. tell your doctor if you have kidney problems, glaucoma, trouble urinating, or an enlarged prostate. these may worsen with spiriva. discuss all medicines you take, even eye drops. stop taking spiriva and seek immediate medical help if your breathing suddenly worsens, your throat or tongue swells, you get hives, vision changes or eye pain, or problems passing urine. other side effects include dry mouth and constipation. nothing can reverse copd. spiriva helps me breathe better. (blowing sound) ask your doctor about spiriva. [ male announcer ] this december, remember -- what starts with adding a friend... ♪ ♪ ...could end with adding a close friend. ♪ the lexus december to remember sales event is on,
10:59 am
offering some of our best values of the year. this is the pursuit of perfection. we're asking you this morning to talk about it in the spirit of thanksgiving. tell us why you're thankful. about our capital assistant. tom writes i am thankful our capitalism has bred produced such minds. capitalism equals freedom. succeed or fail, but it gives us all an opportunity. couple of nice ones there as
11:00 am
they continue to come in. it's an important sentiment to try to keep alive, guys, amid skeptical, what's turned out to be a cynical year. >> what's coming up tonight? >> we are all about the black friday trade and we are going to go under cover. in terms of whether or not showrooming actually happens. have an undercover package there and david rosen berg on the fiscal cliff. >> a list of ten things. happy thanksgiving, guys. >> you, too. and a great weekend. >> in the meantime, if you're just tuning in, here's what you missed this morning. >> welcome to our hour three of "squawk on the street." >> this is a company as you know our thesis was they have been basically off setting a decline in their business by making acquisitions. in this case, almost
11:01 am
disasterous. >> the public is so fed up with washington they're going to scare the politicians to not play politics and do the right thing and that's my hope. >> 10-year-old boy i have, no toys. done. >> toys are over and done with. >> just sporting goods. under armour and sneakers. that's what he wants from everybody. sneakers. >> all right. >> faster to run away from you with. >> yeah. >> there he is. >> in television, that's what we call a get. if you can book that guy. >> bring on the rally, i guess, traders are saying to him. really? wow. >> all right. >> you know the holiday rs here when santa rings the opening bell. >> we want a deal on the fiscal cliff. >> it's official. it comes from santa himself. >> faction or fiction, it's buzzier around this time than normal. >> fiction. crush isn't much of a crush anymore. >> important point is, avoid the
11:02 am
fiscal cliff, we do that, we believe the economy can take off. stakes are high. we want to make sure all the players are together on that. >> good morning, welcome to the new york stock exchange. let's get a check of the markets on this last session. the dow and the s&p actually got a mixed market here. s&p's lost some ground. s&p and nasdaq have been up three straight sessions. we'll see what happens. the dow is hanging on to a 21-point gain. deer says profit increased 3% for the quarter driven by strong growth, however, earnings per share missed the -- news corp. is in negotiations to aquar simon and shuster book business. news corp. is in the process of
11:03 am
splitting into two businesses. our road map for the next hour in case you didn't know, only two days away from black friday, so will holiday spending be more robust or are consumers tightening their belts? what about choosing between the likes of an ipad, galaxy and kindle? what tablet is santa grabbing. crude, gold, equities and fears over the looming fiscal cliff. we'll get you ready to go with some turkey day trades. in the meantime, we are just a couple of days away from black friday or as some are calling it, black thridaw because some retailers are beginning their deals tomorrow. in a looming fiscal cliff that could hit wallets everywhere, will consumers fork out their precious dollars? an economist joins us from now. michelle, good morning. happy thanksgiving. we're just coming off a couple
11:04 am
of consumer sentiment numbers that were okay. does this shopping season is going to be all about? >> i think if you look at the leading indicators heading into black friday this year, fundamentals are stronger. consumer sentiment is higher than it was last year, the stock market is higher, the unemployment rate is lower. gasoline prices are about the same, so absent anything else, i would argue it's better holiday shopping season. come from a combination of lingering hurricane effects, so the fiscal cliff concerns. >> how much of those, we just had this discussion to come degree, how much are households grappling with this? >> there wasn't that much conversation about it in the average sentiment surveys. didn't really see it in the household sector, but i think
11:05 am
now it's becoming much more common place. people are starting to worry a bit more on what happens at the end of the year. am i going to see a big hit to my income as a result to the change of tax policy. i think that's going to leave consumers more cautious. not sure if it ends up translating a big ding to holiday shopping. >> you mentioned sandy and we have had some of your colleagues, your rivals on the street. very low numbers, michelle. i think deutsche is at 25. is it going to be that dramatic? >> it's very hard to tell. i mean, obviously, jobless claims spiked higher, so if you take jobless claims as is, it would imply something similar to nonfarm payrolls. how does the bls attempt to control for the hurricane? for hurricane katrina, they changed their estimation procedures to attempt to control for the fact businesses were closed so they weren't getting respondents as a result of
11:06 am
closed businesses. after katrina, you had a sharp decline in payrolls. actually, negative after a trend or 200,000 a month. so if it's anything similar to that, then i would expect to see a soft jobs number next month, but the idea is to look past that, right? we know it's a temporary bias. it doesn't necessarily tell us anything about the underlying trend in the economy and you'll get a reversal on the subsequent months after the downward buys from the hurricane. >> but i just wonder if we work our way into december and people are on vacation and not as attuned to the news as they are in other part os the year, but if there's no agreement in washington and if sandy results in noise issy numbers that are bearish, there's a chance you might be revising some expectations in the next month, no? >> and you're right.
11:07 am
even though we know there's bias and distortions to the data, it's hard to quantify that. you have this worry that maybe the trend did change, so you're right in that it could. the comekocombination of that v the fiscal cliff could come together to be a soft period of data flow. we've been below for some time, so i don't suspect we're going to change our forecast that much. we've been looking for 1% since the beginning of the year, this has within our forecast, so we feel pretty good with our current trajectory. the risk is that perhaps we take it down a bit, but i don't think we're going to make a significant change. >> no, we've giffin you a hard time about that. but that stands for much of the year. but you're looking pretty good right now. have a great holiday. >> you, too, carl. >> see you next time. joining us this morning, gary, welcome back. missed you last couple of days. >> haven't seen you in a long time here at the exchange, so thanks for having me back in the big house, as they say.
11:08 am
hewlett-packard is the gift that keeps on giving if you want to find out everything that could be wrong with a public company. going back to the friday night announcement, when the board made a decision to let mark herd go. it's not about hewlett-packard today. it really talks more to the whole investment thesis behind getting invested in a public company. there were eight banks. these are the investment banks that the board of directors and hewlett-packard decided to give compensation to as a result of the due diligence done and advise given on the acquisition. bank of america. jpmorgan. barclays. basically, anybody in the business of getting mergers and acquisition advice got a piece of this pie. additionally, there was a lot of focus on autonomy. let's not forget the fact there was a charge related to another acquisition and remember, too,
11:09 am
this is a company that has spent $38 billion, $38 billion on m and a, twice the market cap right now. over the last several years and it's very simple here. we know that nine out of ten deals don't make sense. we know the numbers point out, but only one and ten m and a over the long-term has value. you watched meg whitman here yesterday. i don't know if you caught mike lynch. fantastic interview. this is what i do know. until investors start making board of directors members accountable, you can no longer, you've heard me say this before. this is what i think today. the board of directors and being on a board of directors is not able going to the meetings once a quarter, attending the golf outings, going out to the social functions. it has to do with taking responsibility. this is where the failure is here. everything i pointed out to you is a failure at the level of the board of directors.
11:10 am
i think there is some value in hewlett-packard right now. meg whitman was on this board of directors when this acquisition was made. not the ceo, but i think hue let pack ward is going to have to do it again here. anyone who is a smart investor is not going to touch this stock until they clean house again because this board of directors approved those payments, did this deal and this board of directors, if they have questions about the autonomy deal, they went ahead and did it. >> she's already argued there's been a fair amount of turnover on the board. >> if i was going to put my money into this xhaen today and i do believe there's value there now, i would want to see an entire clean house. >> including meg. >> including meg whitman. >> so, you're calling for her head before you would get back into the stock, you'd like to see her replaced as ceo. >> i think she's a cry baby and when i heard her say yesterday, i'm not involved, i don't buy it. i think that you cannot, cannot
11:11 am
be on a board of are directors o f a company and not take responsibility. that cou i can list you several more here, but that's the way i look at this here. >> don't go to far. rick santelli's in chicago. rick? >> well, carl, as we embark on the holiday markets and it really does officially begin just about now, there's a lot of things i've learned over the years as a trader or recently being on cnbc the last baker's dozens years from traders on how to play holiday markets and many would say just avoid them. well, of course, if you're a long-term play per. if you're a stock valuation or balance sheet picker. yes, probably avoid that. but many down here if you're patient, they can find a lot of very profitable trades, so let's start in some of the easy ones. opening ranges, during holiday thin markets, what day traders love to do is use the opening range as a pivot. especially in the stock indices,
11:12 am
so the dow futures, s&p futures, the emini futures and if by mid session, the range is larger, change that. they hit the midpoint of the session, mid session, to be your new pivot. another issue with opening range, if my mid session, the opening range is is extreme, meaning it contains the higher low of the day, it doesn't give you a trade. it gives you a countertrade. if that condition gets reversed later in the session, meaning if you trade up through that extreme or down through that extreme, go with it, do a trend trade. now, if you're looking for intraday trades, it's a little bit different and many of the traders i talk to say you want to look at the footprint of the markets. the treasuries have been rallying, but the last several sessions, they seem to be going the other way. traders would say look for the thin trade to be countertrend,
11:13 am
so in this instance, maybe some more selling pressure in treasuries. another market that would be a different interpretation would be the dollar yen. the dollar yen has taken off in favor of the dollar and in favor of a thin market, a lot of traders would say go with it. the last one, high, low, particular midpoint. talked about it before. mid session, take the high, the low, find a midpoint and draw a perpendicular line. the market will follow that line for the second half of the session. carl, back to you. >> rick santelli in chicago. there's a number of compelling choices on tablets, but which one should santa put in his sleigh? also, crude, gold and equities. we'll get you ready to go with some trades for turkey day when we're back in two minutes. customer erin swenson bought from us online today.
11:14 am
so, i'm happy. sales go up... i'm happy. it went out today... i'm happy. what if she's not home? (together) she won't be happy. use ups! she can get a text alert, reroute... even reschedule her package. it's ups my choice. are you happy? i'm happy. i'm happy. i'm happy. i'm happy. i'm happy. happy. happy. happy. happy. (together) happy. i love logistics.
11:15 am
thrget 3 yearsgiving weekend, interest-free financing and save up to $600 on beautyrest and posturepedic. even get 3 years interest-free financing on serta icomfort and tempur-pedic. mattress price wars ends sunday at sleep train.
11:16 am
remember a tablet meant an ipad? this holiday, you'll have a slew of options. in so cluttered a market, which is going to top santa's list? sandra adams studied computer trends and -- guys, good to see you. happy thanksgiving in advance. we were just talking off camera about the dynamics of this
11:17 am
season and how apple made a strategic choice to keep price points high and they have allowed a chance for rivals to come in underneath. >> yes, i mean, both kindle and nook are now, it's really advanced $200 tablets and apple launched theirs at $330 with a 6 6% price premium. >> who's first in line? >> i think amazon is the biggest threat because they have the content delivery machine. they have access to -- they're much bigger long-term threat to apple than samsung or lg. >> your thoughts on the choice apple has made? i keep trying to envision the choice they have made and investors would have screamed about shrinking margins. >> apple didn't have to scrape the bottom of the barrel because
11:18 am
they command a premium price from consumers and the ipad mini is a really delightful product to use, but amazon also has a compelling product. they have hundreds of millions of consumer credit cards on fire. also, we see barnes and noble as a credible competitor, although on a smaller scale. the nook tablet is a great tablet for families and has a design this year, then you've got google and microsoft with their own products, so consumers really do have a lot of choice this season. >> the "times" did a great piece over the weekend about how in a prior era, apple's advantage was they had the apps. the hundreds of thousands of apps. that's really been equalized, too. >> it's true, but it's really about the apps that matter. so, barnes and noble, for example, has really developed some compelling kids applications because they understand that moms are sharing
11:19 am
these devices with their kids. amazon is is really focused on the video scenario and they've added some really interesting features, integrating imdb with your video experience, so it's not only about having the volume of apps. it's about having faulty of apps and we're starting to see that develop more in the market. >> i think the first wave of tablets has people didn't mind paying $500 for the tablet, but it's the second wave and people are getting the second tablet for the household. maybe something that the kids are going to use. i have three children under 6 years and i don't want to buy them something that's 3$30, so probably a second device. >> so, do you think apple is most exposed to disappointment this season or not? >> it is because it is sky high markets. there's already some signs that
11:20 am
the tablet market is slipping faster than people expected. it could be 40% by next autumn. >> is there an upside for apple? >> absolutely. we see apple sales really only hamp perred by their supply and we've heard that simply on the ipad mini could be constrained this season. the other market dynamic that's new is is microsoft and there's been pent up demand among consumers for buying windows tablets. that has fallen. it was at a high of 45% of u.s. tablet shoppers said they wanted a windows tablet, now, it's down to 18%, so microsoft has a lot of work to do with their markets. at least they have a product on the market now. >> have a great holiday. thanks for your insights today. still ahead and with just 34 days until christmas, retailers are fighting harder than ever for your dollars. which will come out on top? we're going to name some names after a break. can i help you?
11:21 am
i heard you guys can ship ground for less than the ups store. that's right. i've learned the only way to get a holiday deal is to camp out. you know we've been open all night. is this a trick to get my spot? [ male announcer ] break from the holiday stress. save on ground shipping at fedex office. a body at rest tends to stay at rest...
11:22 am
while a body in motion tends to stay in motion. staying active can actually ease arthritis symptoms. but if you have arthritis, staying active can be difficult. prescription celebrex can help relieve arthritis pain so your body can stay in motion. because just one 200mg celebrex a day can provide 24 hour relief for many with arthritis pain and inflammation. plus, in clinical studies, celebrex is proven to improve daily physical function so moving is easier. celebrex can be taken with or without food. and it's not a narcotic. you and your doctor should balance the benefits with the risks. all prescription nsaids, like celebrex, ibuprofen, naproxen, and meloxicam have the same cardiovascular warning. they all may increase the chance of heart attack or stroke, which can lead to death. this chance increases if you have heart disease or risk factors such as high blood pressure or when nsaids are taken for long periods. nsaids, including celebrex, increase the chance of serious skin or allergic reactions or stomach and intestine problems, such as bleeding and ulcers,
11:23 am
which can occur without warning and may cause death. patients also taking aspirin and the elderly are at increased risk for stomach bleeding and ulcers. do not take celebrex if you've had an asthma attack, hives, or other allergies to aspirin, nsaids or sulfonamides. get help right away if you have swelling of the face or throat, or trouble breathing. tell your doctor your medical history and find an arthritis treatment for you. visit celebrex.com and ask your doctor about celebrex. for a body in motion.
11:24 am
welcome back. we have an interesting guest today. christopher horner, an author and the senior fellow at the competitive enterprise institute, cei. welcome, christopher. >> thank you, rick. >> well, it seems as though the election's over and all candidates were all happy about natural gas, the president just talked about it, but yet, it seems as though now that that's over, the war on fossil fuels is beginning afresh. can you tell me your thoughts on that, sir? >> what we have found is that they are desperate for the public to not see how they want to take this third run at the 1992 btu tax, then the
11:25 am
elections. they're trying a back door way, but now, it seems they're talking feverishly among themselves. who knows if it's slyke solyndra, bund bundlers, pressure groups and so on, they want a carbon tax and have admitted to having thousands of e-mails in the treasury department's office. >> who's the they we are referring to? >> the treasury department has established an office called the office of environment and energy. nothing to do but sit around in anticipation of giving revenues to administer -- or a carbon tax. why would the office of international affairs have this? three years ago next week, the president contributed the united states to being the biggest contributor to a $100 billion annual fund in copenhagen. negotiations begin again next week. that's where this office is,
11:26 am
that they're refusing so let us see so that we had to sue them. >> i'm not trying to give you a hard time, but how do we know they exist? >> because they told us. they acknowledginingeed in throp three reasons why the disclosure would not inform the public. they said we'd have to copy 7,300 e-mails. you don't copy e-mails under a freedom of information act. you move them to a disc for about a quarter. that's one way. but they've admitted them. >> if our viewers want to monoto this, on the other hand, most of the people think with the green notion of carbon trading expense
11:27 am
by business is more about the money. >> i put it in the book that's just out. the liberal war on transparen transparency -- would impact the climate. it's an excuse for a new atm to fund european style government. it's not about the climate. it's all on the liberal war against transparency. >> we're out of time, but quickly, california on monday had an inaugural auction where they auctioned off carbon pollution rights. what are your thoughts on that? >> it's about revenue, not the
11:28 am
climate, but will continue to fly the business out to more hospitable climates. >> thanks, christopher. all's i know, california, illinois are in trouble. energy makeses the economy go around. it makes little sense to me. carl, back to you. >> europe will have the close there and a look at the afternoon may go. back in a minute. [ male announcer ] this december, remember -- you can stay in and share something... ♪ ♪ ...or you can get out there with your friends and actually share something. ♪ the lexus december to remember sales event is on,
11:29 am
offering some of our best values of the year. this is the pursuit of perfection. how they'll live tomorrow. for more than 116 years, ameriprise financial has worked for their clients' futures. helping millions of americans retire on their terms. when they want. where they want. doing what they want. ameriprise. the strength of a leader in retirement planning. the heart of 10,000 advisors working with you one-to-one. together for your future. ♪ together for your future. get 36 months interest-free financing through thanksgiving weekend at sleep train, and save $400, $500, up to $600
11:30 am
on beautyrest and posturepedic. even get 3 years interest-free financing on serta icomfort and tempur-pedic. plus, free same day delivery, set-up, and removal of your old set. when brands compete, you save. but mattress price wars ends sunday, thanksgiving weekend, at sleep train. ♪ sleep train ♪ your ticket to a better night's sleep ♪
11:31 am
they were putting together a deal for this next -- to greece. in europe, michelle caruso-cabrera. >> shocking headline, right? greece still needs money. supposed to get $40 billion. now, looks like it's going to be delayed. the narrative still stands that greece will eventually get the money. not that much pressure anymore. you're right. we did see a lot of green ar rories. show you what's going on with the greek stock market. they continue to get bad news about the economy. city gro citigroup announcing they're going to close nearly half their branches there. only have 37 to start with. in the meantime, because this deal isn't done today, angela merkel of germany coming under intense fire in her home country and looks like the coalition's getting tougher to keep together
11:32 am
because she hasn't been able to get this deal done. she faces re-election later on next year. big news that we haven't covered much here in the ice, but it's a huge deal. "wall street journal" reporting looks like blancor and estrada going to get approved. rising into this news. this is going to be a huge mining natural resources company worth about 70 billion euros and while we are on vacation tomorrow, u.k. prime minister is going to face off against the other european ministers and leaders because they're fighting over the e.u. budget. the budget for the european government. it's only a trillion dollars over seven years, but there's still a lot of arguments about it. at least that's how the rest of europe would see it. >> anyone who reads into the greece meeting is going to ask
11:33 am
whether this is a technical disagreement or a broad disagreement that may not be resolved on monday. >> narrative is greece is going to get the money. the imf says we can't lend to a country unless we know that by 2020, it's going to be about 20%. there's about a 25 billion euro gap. you can change your assumptions about greece's growth rate. you can see to greece instead of 30 year, we'll give you 100. therest a lot of ways to get it done. >> if they don't get the money, the world doesn't fall apart, you know, and greece is still bad. not much changes. >> see you in a little bit. thanks, michelle. time for another capital markets op-ed. gary is at post nine with that. >> thanks, carl. viewers should hopefully know that i feel the pain for savers. the artificial move in interest
11:34 am
rates created by bernanke. borderline criminal, the fact people are being forced into equities. that being said, i saw interesting research yesterday out of morgan stanley. what they did was they said we're going to look for stocks rateded overweight or equal by the research department. market capitalization had to be above 10 million. 2013 earnings estimates had to be above 2012 and they came up with a very interesting screen in terms of ten names that investors could consider being forced by ben bernanke into buying stocks. let's look at those ten names and they are walmart, microsoft, ge, at&t, johnson & johnson. next screen. proctor and gamble, wells fargo, coca-cola, jpmorgan, philip morr morris. it sort of pains me that this is
11:35 am
where they need to search for yield, but you're trying to figure out where is the dividend safe because if we're going to make the move, the last thing you want to do, you know you're going to have principle risk. bond prices go up and down too, but under different circumstances, at least this is a starting point. good piece out of morgan stanley yesterday and it upsets me every time i have to talk about it because the mapain those that followed the rules, the saverers who pay attention put money away are being forced into the equities. it's a shame, but the reality we have to deal with. back to you, carl. >> thanks a lot. bob pisani's here taking a look at what's moving today. nice to stand with you here today. >> we'll stand together. been standing together for years. so, the important thing is the decline in the markets in selection day has p put congress on notice that some kind of deal must be done, so look how well things have been doing here. the s&p 500, we had that big
11:36 am
decline right after election day and we have been moving up. here is some optimism. i spent a little time calling around, checking to see what people wanted to do. look at the sector gainers in the last week here. if this is not a risk on trade, put up some of the sector gainers and you'll see, housing, gold, cyclical, defense and there's the cbo golds index, too. this is all risk on trades here, so the market is giving a breather. i spent some time today calling around to traders saying when is going to be the cliff you're worried about. when are you going to stop selling rather than the buying that's been going on. here is the sense i got from people. number one, congress has got a two-week good will period. that seems to be the consensus of most of the traders. a for the next two weeks, her l essentially, congress can negotiate a deal. the markets are going to be nervous if there's no indication of a deal by the week of
11:37 am
december 10th. that's about the cut off where most say if we don't see an indication, we're going to get nervous. not priced in at all is no deal. going over the fiscal cliff, that is not priced in at all into the markets and everyone says we'll see a big, steep drop off. what do they need? i asked traders, what's the down payment of the deal. there's three or four elements. this is the minimum we're going to have to take a deal on. a payroll tax hike expire. let that happen. cap itemized deductions for the wealthy. that's what wall street wants to see. whether we'll see that in addition to higher cuts, higher taxes for the wealthy, over 500,000 is what a will the of people are talking about right now. it won't be 250, it will be 500. then extend the debt ceilin. we're goung to run out of money, the ceiling will be hit by
11:38 am
march. >> december 10th is not far a y away. >> two weeks. everyone seems to think two weeks is the grace period. we've got to see some indication of what the outlines of the deal would look like by december 10th. >> it's got to heat up. >> thanks, bob. meantime, the biggest shopping day of the year is is less than 48 hours away, but many retailers trying to get an edge by opening as late as the afternoon of thanksgiving. do more days equate to more spending? nicole regan has been tracking the movement of shoppers online and onfoot. good to have you. >> thank you. good morning. >> how significant is this move and does it benefit one retailer over the other? is walmart well positioned here? >> well, i mean, we've been, the survey that our consumer team did said about 12% of people have been out shopping so far. maybe 20% of sales will be online, but for us, you know, our research in my team is is specific to restaurants and one
11:39 am
piece of data, you can't eat out online. >> this was sort of a first strike initiative i would argue by whom? is it a sears story? walmart story and have you been impressed by the level of copy cats who will open on thanksgiving day? >> in terms of opening earlier, you know, okay, i think that it's really just it's probably just you know, feeding into the frenzy of also the online. some of the -- deals have started. i don't know if you call it what you want to call, but they started this monday, so maybe a preventive measure to make sure that you can get people in the store because online shopping and deals started monday. >> i guess that's true. does it, i guess the impression of going earlier, is that impressive to a consumer? does it mean, is it acretive to
11:40 am
steals in any way? >> you know, so far, the survey data points to not necessarily. it still just might be market share winners and losers in terms of the majority are looking to spend the same or less that year on the holiday season. >> some of your favorite names as we get into season, who are we going to be talking about in the most favorable light come christmas day? >> well, for us, it's going to be where are consumers eating because our practice falls specifically for restaurants, so we're just really excited about people being out this weekend and being in cheesecake factory, stopping by chipoltle and having holiday parties at -- >> thanks a lot. >> thank you. >> st. jude medical taking a big hit today. brian shactman has the details.
11:41 am
>> the stock hitting lows it has not seen since march of 2009. down about 12% on heavy volume. there was an fda report, then wells fargo jumped on top with a downgrade. easily does about 3 million shares a day over seven and a half million so far. it's 11:41 eastern time. back to you. >> still ahead, not quite a billionaire. where you can still become an art collector. we're introduce iing the art wo to the cofounders of artspace, a company hyping itself as the amazon and the race against the clock. courtney reagan has the story on that. >> you know when you need a gift right away, you don't have time to fight the crowds in the store or wait for it to be shipped. a number of retailers are offering instore pick-up. i'll reveal the results coming up. you won't just find us online, you'll also find us in person, with dedicated support teams at over 500 branches nationwide. so when you call or visit,
11:42 am
you can ask for a name you know. because personal service starts with a real person. [ rodger ] at scottrade, seven dollar trades are just the start. our support teams are nearby, ready to help. it's no wonder so many investors are saying... [ all ] i'm with scottrade.
11:43 am
part of a whole new line of tablets from dell. it's changing the conversation. ♪ is what drives us to broadcast the world's biggest events in 3d, or live to your seat high above the atlantic ocean. it's what drives us to create eco-friendly race tracks,
11:44 am
batteries that power tomorrow's cars, nearly indestructible laptops, and the sustainable smart towns of the future. at panasonic, we're driven to make what matters most better. just another way we're engineering a better world for you. coming up, 2013 prediction for the markets black friday bargains. our traders have a list of retail stocks on sale and we'll go live to tel aviv, sight of today' bus bombing to talk with the -- what's it like doing business there as the violence escalates. >> there is so much news today. thanks a lot, scott. nothing more frustrating that battling holiday traffic than fighting the crowds inside the store only to wait in long lines to check out. plenty of retailers, at least in
11:45 am
theory. courtney reagan puts three retailers to the test and joins us with that. >> so, this year's sears is making the -- if you purchase online and drive to the store, you'll have the item loaded into your car in a five-minute window. even on black friday. our undercover cameras were wroling so we wouldn't get special treatment. our experiment starts online at three major retailers. the purchase, a nintendo hand held game con sell. the clock starts the moment we click buy and stops when the console is ready for pick-up. walmart sends us a ready for pick-up e-mail in 41 minutes. sears in just eight minutes. we never got an e-mail from best buy, but when we checked the status ourselves, it said ready,
11:46 am
one hour and 15 minutes later. the clear winner in round one, sea rr sears. now, round two. the actual store pick-up. the clock starts when we hand over the receipt and stops when we've got the console in hand. let's see if they can do it. at the jersey city location, there's a kiosk inside to scan the confirmation e-mail. promise achieved. one minute and 44 seconds later. next, walmart in new jersey, no time promises here, our producer presented the receipt and gets the con sell in two minutes and five seconds. now, best buy. no guarantees here, but after the receipt is taken, we have console in hand in just one minute and 58 seconds. >> have a great day. >> sears wins again, so carl, obviously, when we did this before black friday and at three locations, there is a human
11:47 am
element involved, so all of these times could shift, but they did as promised. i was pleasantly surprised. >> given the beating they've taken over the past two years, it will be interesting to see f operationally, they were as impressive as they were in the piece of tape. >> and if consumers take advantage. i would just encourage the sh shoppers out there to ask questions of the associates because these programs will vary from store to store and you could even get different answers within the store, which is what we found a couple of times with some of the price matching. sometimes, they said they would. sometimes, they said they would. just keep asking until you get to a manager and know finally if they'll do it. >> that's what we call enterprise reporting in this business, court. nice job. when we come back, a start-up gaining lots of chatter from up and coming artists. they're hyping their company as the amazon art dealing. back in two minutes. so anyway, i've been to a lot of places.
11:48 am
you know, i've helped alot of people save a lot of money. but today...( sfx: loud noise of metal object hitting the ground) things have been a little strange. (sfx: sound of piano smashing) roadrunner: meep meep. meep meep? (sfx: loud thud sound) awhat strange place. geico®. fifteen minutes could save you fifteen percent or more on car insurance. ♪
11:49 am
welcome to the world leader in derivatives. welcome to superderivatives.
11:50 am
11:51 am
the cofounders of art space joins here. good to see you guy, welcome. it's fascinating idea and i imagine the market as people try to find some place for cash must be doing okay. it's been about 16 months. >> artspace.com is we're building a marketplace for fine art that we source from the world's leading galleries, cultural institutions and museums worldwide and make those more accessible. >> so, membership is free? >> yes. >> about 100,000 members so far? >> yes. >> and how much are the pieces that are selling? >> sure, if you're a new collector and looking to discover and learn about art, you can find pieces start iing
11:52 am
$200. but you can buy pieces all the way up to $100,000 on the site and higher, but mostly, it's priced in se the $5,000 range. >> you spent some time on wall street. 20 years at credit swiss? who are you displacing here? is this an attempt to put galleries out of business or work in concert with h them? >> this is an $80 billion global business. we think the online portion ends up being 10 to 15 billion of that. we're still in the early stages of internet transformation, so today, we're partnering with galleries, museums around the world. they have fantastic works they need to expose, so we are partners with the galleries and we're bringing them all
11:53 am
together. >> i saw a couple of names i might recognize. we're not talking about completely unknowns. are we talking about some yell known artists represented here? >> we're working with the world's best artists, but we also are a place where you can come and discover emerging artists, whom we believe are going to be the next rising stars. >> who would be some names to be particular with? >> robert roshenberg -- >> and those are at prices that don't necessarily break the bank? >> not break the bank. we're trying to make works really access bly priced for people and if they want to move up the ladder, we're offering those pieces as well. >> we keep reading about roth ko's going for tens of millions of dollars. does that mean the whole market is following suit? are there others trying to decouple from that? >> there's a rising tide and the fine art market more broadly has an extraordinary place to put
11:54 am
money. you saw the auctions last week. a billion dollars in contemporary art, and that creates an opportunity for everyone to come to artspace to find works access bly priced. there's a whole spectrum. >> we recently did a piece on art fraud, how do you fight against that? >> we're dealing with primary market works we're getting the works from the artists, the galleries or museums who are deal wg the artists, so it's much easier to determine that when you are working directly with them. producer of the work. >> you guys make any money yet? >> we're investing for the feature. >> i like the way you say that. >> $10 billion business, so we've generated terrific traction. for really an early stage business model, but you know,
11:55 am
it's clear that there's huge value that we convey to the galleries, museums, cultural institutions and for the 25 million households in america that buy art every year, we offer them the choice that really doesn't exist anywhere else. >> is this pivot around household creation? do you need to see housing do well before you see the numbers go up? is it about you know, as we're seeing housing gain some traction here this year. >> certainly, a positive. greater hustle formation, but we're talking about $30 billion spent by households today outside the auctions, which is another 30 billion. i think there's more to run before we're impacted by broader economic trends. >> thank you so much. don't forget to tweet us. our capitalist system isn't perfect, but brings us to this morning's question. in the spirit of thanksgiving, we're asking you to el us what is it about our system you're most thankful for?
11:56 am
we'll get your answers in just a moment. can i help you? i heard you guys can ship ground for less than the ups store. that's right. i've learned the only way to get a holiday deal is to camp out. you know we've been open all night. is this a trick to get my spot? [ male announcer ] break from the holiday stress. save on ground shipping at fedex office.
11:57 am
11:58 am
♪ you can stay in and like something... ♪ [ car alarm deactivates ] ♪ ...or you can get out there with your family and actually like something. ♪ the lexus december to remember sales event is on, offering some of our best values of the year. this is the pursuit of perfection.
11:59 am
for this last trading day before thanksgiving, our system isn't perfect, but still the best in the world and we're all participants brings us to this morning's question. in the spirit of thanksgiving, tell us why i'm thankful. what is it about our capitalist system you're most thankful for. rick writes as a country, we can afford to provide a safety net. antonio writes i'm thankful for an america where the richest men were not born the richest and ed writes the ability to fail and start again. all good sentiment today as we take stock of what we're thankful for in this crazy economic world of ours. want to point out a couple of moves among stocks today. facebook rallying over 5%. levels to get us back to august here as we are above $24 a share. hewlett-packard holding on to some gains today, up over 2% after yesterday's

tv
Squawk on the Street
CNBC November 21, 2012 9:00am-12:00pm EST

News/Business. Melissa Lee, Carl Quintanilla, David Faber. Opening bell market action. New.

TOPIC FREQUENCY Us 34, Greece 16, Hp 16, Carl 13, Turkey 10, Israel 9, Europe 9, Bob 7, Mr. Cohen 7, U.s. 7, New York 7, Boston 6, Chicago 6, S&p 6, Deloitte 4, Sears 4, Tempur-pedic 4, Brian Shactman 4, Phil 4, Washington 4
Network CNBC
Duration 03:00:00
Scanned in San Francisco, CA, USA
Source Comcast Cable
Tuner Virtual Ch. 58 (CNBC)
Video Codec mpeg2video
Audio Cocec ac3
Pixel width 528
Pixel height 480
Sponsor Internet Archive
Audio/Visual sound, color


disc Borrow a DVD of this show
info Stream Only
Uploaded by
TV Archive
on 11/21/2012
Views
144